Canadian Stocks Are Down On Oil Weakness -- Canadian Commentary

(RTTNews) - The Canadian stock market is losing ground Monday morning, adding to the losses of the previous three sessions. Energy, mining and financial stocks are among the weakest performers this morning. Oil prices have dropped back below $50 a barrel and commodity prices are struggling to advance. The market nearly erased its early losses, but has since fallen back near the lows of the session after the release of some disappointing U.S. economic data.

Markets in Europe are climbing Monday. After meetings in Brussels, Greece has reached an agreement with eurozone creditors to extend its bailout agreement for four months. The agreement will help Greece avoid an economic crash and an ouster from the Eurozone. Greek finance minister Yanis Varoufakis has pledged to honour all debts and initiate reform to bring back the country to a financial stability. The minister added that the country would continue with painful reforms.

Markets in the United States are under pressure this morning. Uncertainty about the near-term outlook for the markets may lead to choppy trading on Wall Street, as traders question whether stocks can sustain their recent uptrend. A downgrade to Dow component Boeing is weighing on the index. U.S. existing home sales for January also came in weaker than expected. Additionally, trepidation ahead of Federal Reserve Chair Janet Yellen's testimony before the House and Senate may keep some traders on the sidelines.

Existing home sales in the U.S. fell by more than anticipated in the month of January, according to a report released by the National Association of Realtors on Monday. NAR said existing home sales tumbled 4.9 percent to an annual rate of 4.82 million in January from an upwardly revised 5.07 million in December.

Economists had expected existing home sales to fall to a rate of 4.95 million from the 5.04 million originally reported for the previous month.

The benchmark S&P/TSX Composite Index is down 43.35 points or 0.29 percent at 15,128.89. The market is slightly off its morning low of 15,120.75 and down from a high of 15,174.31.

On Friday, the index closed down 8.09 points or 0.05 percent, at 15,172.24. The index scaled an intraday high of 15,232.74 and a low of 15,124.30.

The Health Care Index is providing the biggest boost to the market this morning, with a gain of 4.99 percent. Valeant Pharmaceuticals International (VRX.TO) is soaring by 14.10 percent. The company has agreed to acquire Salix Pharmaceuticals for $158.00 per share in cash, or approximately $14.5 billion.

The Gold Index is climbing by 1.39 percent. The price of gold is attempting to recover, after briefly dipping below $1200 an ounce. Yamana Gold (YRI.TO) is rising by 1.83 percent and Goldcorp (G.TO) is advancing by 1.41 percent. IAMGOLD (IMG.TO) is increasing by 2.05 percent and Barrick Gold (ABX.TO) is adding 0.87 percent. Eldorado Gold (ELD.TO) is also climbing by 3.24 percent. The Capped Materials Index is also gaining 0.38 percent. Franco-Nevada (FNV.TO) is up 1.88 percent and Agnico Eagle Mines (AEM.TO) is higher by 2.78 percent. Potash Corp. of Saskatchewan (POT.TO) is up 0.28 percent and Agrium (AGU.TO) is adding 0.58 percent.

The Capped Information Technology Index is rising by 0.66 percent. Constellation Software (CSU.TO) is up 0.39 percent.

The Energy Index is falling by 1.55 percent. Crude oil prices tumbled below $49 a barrel Monday morning on signs that major producers will continue a recent price war.

Markets are exceedingly oversupplied, as confirmed by U.S. crude oil inventory figures showing a massive build in stockpiles. With much of the nation slowing down due to subzero temps, inventories are expected to continue to build as OPEC and non-OPEC suppliers refuse to cut production.

Encana (ECA.TO) is falling by 1.61 percent and Suncor Energy (SU.TO) is losing 0.13 percent. Canadian Natural Resources (CNQ.TO) is down 2.35 percent and Canadian Oil Sands (COS.TO) is losing 1.27 percent. MEG Energy (MEG.TO) is sinking by 2.83 percent.

Cenovus Energy (CVE.TO) is falling by 1.67 percent and Vermilion Energy (VET.TO) is declining by 1.74 percent. Pacific Rubiales Energy (PRE.TO) is also decreasing by 4.63 percent.

Bankers Petroleum (BNK.TO) is declining by 4.81 percent. The company announced that its subsidiary, Bankers Petroleum Albania Ltd., has reached a full and final settlement with BP Oil International Limited and has agreed to pay US$16.5 million inclusive of all costs and interest. in connection with a September 2013 lawsuit.

The heavyweight Financial Index is decreasing by 1.48 percent. National Bank of Canada (NA.TO) is lower by 1.51 percent and Royal Bank of Canada (RY.TO) is declining by 1.96 percent. Bank of Montreal (BMO.TO) is losing 1.03 percent and Canadian Imperial Bank of Commerce (CM.TO) is decreasing by 1.78 percent. Toronto-Dominion Bank (TD.TO) is falling by 1.27 percent and Bank of Nova Scotia (BNS.TO) is weaker by 1.15 percent.

The Diversified Metal and Mining Index is also lower by 1.41 percent. Capstone Mining (CS.TO) is declining by 3.68 percent and Teck Resources (TCK-B.TO) is losing 2.90 percent. First Quantum Minerals (FM.TO) is down 0.36 percent and Lundin Mining (LUN.TO) is lower by 1.31 percent. HudBay Minerals (HBM.TO) is decreasing by 0.77 percent and Finning International (FTT.TO) is falling by 0.62 percent.

The Capped Industrial Index is falling by 0.71 percent. Bombardier (BBD-A.TO) is down 3.86 percent and Canadian Pacific Railway (CP.TO) is lower by 0.47 percent.

Canadian National Railway (CNR.TO) is falling by 1.45 percent. The company met the leadership of Unifor for several hours in Ottawa today with officials of the government's Federal Conciliation and Mediation Service but was unable to negotiate all terms of a new contract. However, the two parties will meet again first thing tomorrow morning in Ottawa to resume collective bargaining.

Capital Power (CPX.TO) is dropping by 3.97 percent. The company reported fourth quarter funds from operations of $102 million, down from $110 million a year ago.

Supremex Inc. (SXP.TO) is rising by 2.78 percent. The company reported fourth quarter earnings per share that were flat with last year at C$0.09.

On the economic front, German business confidence improved for a fourth consecutive month in February to its highest level in seven months, but the pace of strengthening was modest amid concerns over the uncertainty surrounding the Greek situation.

The Ifo Business Climate climbed to 106.8 from January's 106.7. Economists had forecast a stronger score of 107.6. The latest reading, however, was the best since July last year, when it was 108.1.

British retail sales growth eased sharply in February to its weakest level since late 2013, after six months of robust performance, survey data from the Confederation of British Industry revealed Monday. The balance of the CBI's distributive trades survey dropped to +1 from +39 in January. Economists were looking for a figure of +35.

In commodities, crude oil futures for March delivery are down $1.52 or 2.99 percent at $49.29 a barrel.

Natural gas for March is down $0.027 or 0.91 percent at $2.924 per million btu.

Gold futures for April are up $0.70 or 0.06 percent at $1,205.60 an ounce.

Silver for March is up $0.222 or 1.36 percent at $16.495 an ounce.